The logic of fossil fuel divestment-reinvestment

Climate change is a profound threat to humanity

New York Times – ‘Short Answers to Hard Questions About Climate Change’: Longer term, if emissions continue to rise unchecked, the risks are profound. Scientists fear climate effects so severe that they might destabilize governments, produce waves of refugees, precipitate the sixth mass extinction of plants and animals in Earth’s history, and melt the polar ice caps, causing the seas to rise high enough to flood most of the world’s coastal cities. All of this could take hundreds or even thousands of years to play out, conceivably providing a cushion of time for civilization to adjust, but experts cannot rule out abrupt changes, such as a collapse of agriculture, that would throw society into chaos much sooner. Bolder efforts to limit emissions would reduce these risks, or at least slow the effects, but it is already too late to eliminate the risks entirely.

Government actions to curtail climate change remain inadequate.

If fossil fuel companies burn all their reserves of oil, gas and coal, we will far exceed ‘safe’ limits to global warming

Carbon Tracker analysis: “Only 20% of the total [global] reserves can be burned unabated, leaving up to 80% of assets technically unburnable… Already in 2011, the world has used over a third of its 50-year carbon budget of 886GtCO2, leaving 565GtCO2. All of the proven reserves owned by private and public companies and governments are equivalent to 2,795 GtCO2. Fossil fuel reserves owned by the top 100 listed coal and top 100 listed oil and gas companies represent total emissions of 745GtCO2. Only 20% of the total reserves can be burned unabated, leaving up to 80% of assets technically unburnable.

Bloomberg: Clean Energy Isn’t Just the Future—It’s the Present: “Renewables provided 55 percent of all new electrical capacity worldwide last year, the most ever. In some regions, solar is the cheapest source of power, and it will only get cheaper. Bloomberg New Energy Finance estimates that a watt of power from ground-mounted solar will drop a further 36 percent by 2025. Solar’s appeal isn’t just one of cost; it’s the most democratized and decentralized power source.”

While long-term value in the fossil fuel sector appears to be gravely threatened

The Wall Street Journal: The world’s biggest oil companies are struggling just to break even. Despite billions of dollars in spending cuts and a modest oil-price rebound, Exxon Mobil Corp., Royal Dutch Shell PLC, Chevron Corp. and BP PLC didn’t make enough money in 2016 to cover their costs, according to a Wall Street Journal analysis.